Ryan vows to modify health care bill

Monday

Mar 20, 2017 at 3:37 PM

Here are examples of potential costs for Stark County residents

Jack Torry Dispatch Washington Bureau @JackTorry1

WASHINGTON Following criticism from organizations representing older people, House Speaker Paul Ryan, R-Wis., has pledged to modify a health care bill he backs to help people between ages 55 and 64 buy individual health insurance policies.

“We believe we should offer more assistance than what the bill currently does,” Ryan said on Fox News Sunday.

In a letter to Congress and a TV commercial, AARP assailed the House Republican leadership health care plan which would replace the 2010 health known signed by former President Barack Obama and known as Obamacare.

The TV commercial, called “Stop The Age Tax” and which runs an unusually long time of one minutes and 18 seconds, a man in his 50s is chopping wood and complains the GOP bill overcharges “older Americans for their health insurance.”

So is AARP, which represents 38 million older Americans, correct? Under Obamacare, people buying health insurance through the individual market as opposed to receiving coverage through their employers were eligible for federal subsidies to buy those policies through marketplaces established by the federal or state governments.

So, let’s check whether people in their late 50s or early 60s do better or worse under Obamacare or the House GOP plan as it is currently written.

How does the House Republican leadership bill change the individual market?

Under Obamacare, a family of four earning between $34,000 and $98,000 a year a year can receive subsidies to buy individual polices through the exchanges. The Republicans would scrap the subsidies and substitute a refundable tax credit ranging from $2,000 a year to $4,000 a year based on how old you are as opposed to income. A 27-year-old would be eligible for the $2,000 credit while a 60-year-old would be eligible for the $4,000 credit. When an individual earns more than $75,000 a year, the refundable tax credit is slowly phased out.

What is a refundable tax credit?

Unlike an ordinary tax credit, a refundable tax credit means an individual can receive more federal dollars as a refund than they actually paid in taxes.

How does the Republican refundable tax credit compare to the Obamacare subsidies people receive to buy individual policies in the exchanges?

Depends on your age and where you live. According to the Kaiser Family Foundation, a 27-year-old earning $30,000 a year in Stark County would receive a $2,000 tax credit under the Republican bill to buy an individual policy compared to nothing under current law. A 40-year-old would receive a $3,000 refundable tax credit compared to $540 under Obamacare. But a 60-year-old earning $30,000 a year would receive the $4,000 refundable tax credit under the GOP bill compared to $3,930 a year under Obamacare.

What if you earn more money?

Kaiser calculates a 27-year-old in Stark County earning $50,000 a year would receive a $2,000 a year tax credit under the Republican plan compared to nothing under Obamacare. A 40-year-old would receive $3,000 in a tax credit compared to nothing under Obamacare. By contrast, a 60-year-old earning $50,000 annually would receive a $4,000 tax credit under the GOP bill versus a $1,310 subsidy under Obamacare.

What if you live in a different county?

You can use the following link to check for yourself -- http://kff.org/interactive/tax-credits-under-the-affordable-care-act-vs-replacement-proposal-interactive-map/

Any other changes that could hurt someone older?

Under Obamacare, insurers cannot charge older people premiusm which are more than three times what they charge younger people. Under the House Republican plan, they can charge five times what they charge younger people.

So it appears if you are older and earn less, you do not do not do as well under the GOP plan as Obamacare?

Probably, but not definitely. That is because 60-year-olds have higher health costs than younger people and pay more for their health care assuming health costs remain the same. However, Republican sponsors hope by making the refundable tax credit so generous for younger people, it will encourage younger and healthier people to buy policies through the exchanges, and the cost of insurance premiums would drop. The non-partisan Congressional Budget Office last week calculated that under the GOP bill, premiums would decline by 10 percent between 2020 and 2026.

How many people does this effect?

Somewhere between 18 and 29 million because the overwhelming majority of Americans already have coverage. About 156 million Americans receive health insurance through their employers while 55 million seniors are on Medicare and 74 low-income million are on Medicaid.

Just how did the 2010 health law known as Obamacare work?

The uninsured could obtain coverage in two ways. The law expanded Medicaid to allow a family of four earning as much as $33,948 a year to be eligible. But for families of four earning between $34,000 and $98,400 a year, they could receive federal subsidies to buy individual insurance policies through the federal or state marketplaces, known as exchanges. People were fined if they did not buy a policy. But a number of insurance companies dropped out of the exchanges because not enough younger and healthier people signed up for insurance, which led to companies losing money on the exchanges.

jtorry@dispatch.com

@jacktorry1

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